Empirical Economic Bulletin, An Undergraduate Journal


Japan was in the most prosperous period of the economy in the 1980s, during which the GDP growth rate of Japan was high-speed, and the economic scale of Japan was second only to the United States in the world. Japan became the second largest economy in the world. But the boom was the unsustainable illusion of a bubble economy of rising house and stock prices. In the early 1990s, the collapse of Japanese real estate and stock market prices severely affected the Japanese economy, leaving many banks and companies heavily indebted. Japan's economy fell into a decade-long stagnation known as the "lost decade." The effects of this bubble economy on Japan have persisted even to the present. This paper will study the variables affecting the Japanese economy from the aspects of macroeconomic factors and social structure factors and discuss what led to the prosperity of the Japanese economy in the period of the bubble economy and what led to the breakdown of the Japanese bubble economy and the decline that continues to this day.